15.2.18

We have received many, many questions about bitcoin. We thought we were clear about it, but it seems not. Let us sum up our position:

1. We love bitcoin from a philosophical point of view, however we wouldn’t invest big money there.
2. Bitcoin is not working as it was supposed to do, transactions are slow and expensive.
3. There is a big difference between blockchain (technology behind bitcoin) and the bitcoin itself. Blockchain has a very bright future ahead.
4. Many people think bitcoin is already dead. We don’t know yet, however, just for the guys who held bitcoins from the beginning and sold half of the position in December (link), if we reach above 30,000, it could be a good moment to sell a high percentage of the remainings. It is like playing with the house money.

Some gurus don’t understand that they might be right about the bitcoin being a bubble, but markets like this one can very easily be manipulated and the price can keep on going up for a long time (story of Herbalife).

9.2.18

Is Peter Shiff right and the recent drop in the markets is just the beginning? Or, on the other hand, is it just a healthy correction? We don’t know. But there are some facts that can help us:

1. Charts. The curve is very far from the mean. It usually reverses.
2. P/E. It is way above the historical average. We can expect to lower a bit.
3. Cash. The politicians won’t be able to resist the pressure and there will be more QE.
4. Timing. Individuals are awful timing the market. Even if we sell our positions now, probably we won’t find the right spot to reenter.

So, being sensible, a possible solution could be to have a balance portfolio (during the last month we’ve talked to many investors and some had more than 60% of their wealth in stocks, which is huge and very risky). Reduce the percentage of shares until you feel comfortable. Also, it could be a good idea to include some gold as insurance. Amanzingly gold is not overvalued.

11.1.18

As most of the readers know, in SimplyNoRisk we try to reduce pain. When fund managers compete to see who has a greater yield every year, we observe it from a healthy distance. That is not our target, but to CONSTANTLY create a sustainable portfolio that never suffers a terrible year.

As we show on the next chart, we have beaten REAL inflation (we use double the official one) and the drawbacks have never been awful. Last year, the SNR portfolio made a sound 9.2%.

The idea of this portfolio, as explained in our book, is based on Harry Browne’s permanent portfolio, but with a more realistic approach. As you can imagine, we are very happy with the results.

27.12.17

16.12.17

As we all know by now, bitcoin is a virtual currency based on a distributed database called blockchain. It was the first crypto money, but there are many others which can be even more interesting, like ethereum.

We have zero doubts about the future success of blockchain. It is one of the most brilliant advances scientists have achieved. However, even if we love the idea, we are not so sure about virtual money. Governments could ban it as they want to have the exclusivity of money creation. In any case, if you are interested in this topic, we have chosen some of the best books about bitcoin so that you can learn on your own:

1.12.17

Some months ago most of the financial analysts were recommended to sell bitcoins. We didn’t agree (link). It seemed it was going to go much higher... And in fact it did:

Now everyone is talking about bitcoins and you hear its target is 40000... We don’t know, of course. However the way it has soared doesn’t “smell” good. Therefore, just to be practical, it might be the wrong moment to enter into this market and it might be the good one to sell half of the position with big gains.

20.11.17

The BIS is “the Central Bank of the Central Banks”. It is based in Basel with offices in Hong Kong and Mexico. Its goal is to create monetary and financial stability. Of course, they set up the rules for the comercial bank’s leverage.

But the purpose of this post is to draw your attention to the very interesting papers you can find in its web. You will have to separate the wheat from the chaff, but, in a sense, it will help you to better understand what is happening globally.

For instance, here you can find the Global Liquidity Indicators, or you can read the interesting Annual Report, or the Research Papers.

8.11.17

...there was a successful shop with a lot of cash in its accounts. It was going to face a lot of competition from other online shops, but it was ready to fight. However a financial firm took control of the shop using other people’s money (leveraged purchase) and didn’t care for the fight. They just wanted to gain access to the cash, so they decided to increase the debt of the shop as much as possible (at the time, it looked good for the debt buyers and/or banks, because the business had more than enough cash) and use the cash to pay themselves.

17.10.17

A common way to invest in gold is to buy certain gold coins (not collectible). For instance: Maple Leafs in Canada, Kangaroos in Australia, but also Britannias in UK. Usually an investor has to pay capital gains tax on the money he is making when selling a product with profit. However, some coins from The Royal Mint are exempt from CGT (link here).

29.9.17

The main intention of this article is to guide you on how to analyse the different medical cards.

The comparison shall include in order of priority:

1) Limit for Outpatient Cancer Treatment / Kidney Dialysis. It should have no limit.
2) Annual Limit.
3) Life Time Limit. Minimum of 1M.
4) Term of Coverage. At least 80 years old. Besides it is necessary to find a solution for this age onwards.
5) Co Insurance.
6) Surcharge if exceed room and board.
7) Cost of Insurance.

Remember that the idea is not to get bankrupt in case something bad happens. It is perfectly acceptable to pay CONTROLLED amounts of money for a treatment. Also that the world is big and it makes sense to find the best countries in terms of healthcare (some even public).